CGV Research Releases New Report Highlighting How Prediction Markets Will Redefine Sports Betting

In Brief

CGV Research’s new report reveals how decentralized prediction markets are transforming sports betting, fan engagement, and real-time price discovery across global sports.

Cryptogram Venture or CGV Research, a firm specializing in cryptocurrency and blockchain analysis, recently published a report examining the evolving intersection of sports and financial markets. The report emphasizes that beyond the visible excitement of stadiums, a parallel activity has emerged in the marketplace, where betting, trading, and price movements reflect the aggregated judgments and emotions of millions globally. Traditional sports betting, the report notes, faces trust challenges: odds are determined by bookmakers, regulations are often opaque, and issues such as match-fixing and corruption persist.

Prediction markets, by contrast, are reshaping the logic of sports wagering through decentralization, transparency, and real-time pricing. In these systems, game outcomes are valued by the collective input of participants, and odds are derived from market consensus, effectively reframing “betting” as a form of prediction

The report highlights the evolution of sports prediction markets from mere entertainment to mechanisms that encode collective judgment. Rather than simply placing bets for excitement, participants now contribute to market prices that capture informed consensus, transforming sports contests into arenas where outcomes are assessed and quantified by the crowd, blending entertainment with analytical participation.

From Bookmakers To Crowd Consensus: How Prediction Markets Transform Sports Forecasting

In conventional sports betting, odds are determined by bookmakers, who act as both rule-makers and participants, creating a structural imbalance of information and incentives. Prediction markets, by contrast, fundamentally change this dynamic. On platforms like Polymarket, anyone can create a market for a sports event, such as “Will Manchester City win the Premier League?” Initial prices may reflect a 50% probability, but as traders contribute capital and new information emerges, prices adjust dynamically in real time. In this system, odds are no longer controlled by a single entity; instead, prices emerge as a consensus among participants, reflecting the collective judgment of the market. The larger and more informed the participant base, the closer prices approximate the actual probability of an outcome. This structure transforms traditional betting into a transparent, information-driven process where traders can effectively “bet against the bookmaker” if their insights are more accurate.

Unlike conventional betting, prediction markets allow for continuous trading during matches. Real-time game developments are quickly incorporated into prices, often reflecting the unfolding situation faster than live broadcasts. For example, during UEFA Euro 2024, Polymarket launched 42 core markets with a total trading volume of $28 million. Spain’s market performance illustrates the system: its pre-tournament price of 0.12 rose to 0.55 after a quarter-final victory, 0.72 twenty-four hours before the final as the market digested injury and tactical updates, and finally reached 1.00 after winning the championship. Compared to fixed odds on traditional platforms, Polymarket reflected key information, including player form, weather, and social sentiment, significantly earlier. This demonstrates that prediction markets are less about luck and more about aggregating and pricing information.

The value of prediction markets lies in information transparency. Whereas traditional betting relies on information asymmetry to benefit bookmakers, decentralized markets treat information as a tradable asset. News, injury reports, social media sentiment, and other data sources are instantly translated into price signals, incentivizing high-quality data sharing. The bookmaker’s role is largely eliminated, with orders matched and settled on-chain without centralized risk control. Community-driven governance determines event creation, dispute resolution, and reward distribution, creating a decentralized ecosystem where accurate information is rewarded.

A similar pattern emerged during the 2024 NBA MVP Prediction Market, launched in partnership with Flipside Crypto. This market combined on-chain data, such as nonfungible token (NFT) trading volumes, with off-chain inputs like Twitter sentiment, injury reports, and schedule analysis. Nikola Jokić’s MVP probability began at 0.28 and rose to 0.65 after the All-Star break, reflecting improved performance and fewer injuries, before climbing to 0.89 by the end of the regular season. The price ultimately reached 1.00, accurately predicting Jokić’s third MVP six weeks before traditional media consensus. This example highlights the predictive power achieved by integrating crowd-sourced insights with on-chain and off-chain data, reinforcing the idea that sports prediction markets operate as decentralized, information-based ecosystems rather than simple games of chance.

From Spectators To Stakeholders: How On-Chain Prediction Markets Are Redefining Fan Economy

Prediction markets are introducing a new dimension to sports engagement by enabling what can be described as the “financialization of viewer participation.” Traditionally, fans were limited to passive consumption—watching games, following commentary, and purchasing merchandise—but prediction markets allow viewers to actively participate in assessing outcomes while potentially earning economic returns. This shift transforms the fan economy from a “watch and consume” model to one centered on “predict and participate,” where fans effectively become market participants rather than observers. Revenue structures are also redefined: instead of exclusivity-driven profits dominated by leagues or broadcasters, earnings are distributed among participants, creating shared incentives. Interaction evolves beyond conventional comments and polls, encompassing active trading, market-making, and arbitrage, while real-time price movements provide immediate feedback on fan sentiment, cognitive shifts, and market consensus.

According to Polymarket data, 68% of sports users identify as “hardcore fans,” highlighting the platform’s ability to deepen community engagement and promote viral adoption. This trend signals the emergence of a “Play-to-Predict” era, where fans move from passive spectators to active, virtual participants. For major leagues such as the NFL, Premier League, and LPL, adopting prediction markets represents not merely a trend but a strategic business opportunity. It creates unprecedented user engagement, converting viewers into stakeholders and amplifying both stickiness and public interest. Market prices themselves act as highly responsive tools for gauging fan sentiment, evaluating player popularity, and testing new rules, offering far more immediate insights than traditional surveys. Furthermore, prediction markets open new commercial channels through official licensing, API partnerships, and transaction fee sharing, providing digital-native revenue streams independent of conventional broadcasting or ticket sales.

A practical example of this evolution occurred during the 2025 “League of Legends” S15 World Championship. On November 2nd, Polymarket and Azuro launched a fully on-chain prediction ecosystem for the event, marking the first global implementation of multi-layered on-chain prediction trading for esports. At a macro level, markets such as “Will T1 win the championship?” reached $18.7 million in trading volume and achieved automatic on-chain settlement in under three seconds. Micro-level markets, like “Who gets the next Dragon?” averaged $420,000 per wave with continuous real-time updates. Player-specific markets, such as “Will Faker’s KDA exceed 10 this game?” saw $1.2 million in volume, settled efficiently through API integration. This event demonstrated the deep integration of esports with blockchain-based prediction markets, creating a transparent, real-time, globally participatory ecosystem for sports forecasting.

Sports Prediction Markets Evolve Toward On-Chain Transparency Amid Regulatory Uncertainty

According to CGV Research, regulation remains a challenge for sports prediction markets, similar to the evolving issues faced by the news industry. In the United States, there is still no unified definition of “event contracts” across bodies such as the CFTC and state gambling commissions, creating a regulatory gray area. Additional risks arise from the potential for manipulation, as player actions could theoretically be influenced to affect market prices. Ambiguities in settlement standards—for example, questions like whether a player actually appeared in a game—can also trigger disputes with oracles. Potential approaches to address these challenges include multi-layered oracle verification systems, such as combining Chainlink with UMA, reputation staking mechanisms to discourage manipulation, and AI-driven anomaly detection to identify suspicious trading patterns or unexpected outcomes. The overarching aim of these systems is to position prediction markets as a transparent and verifiable “on-chain referee” for sports.

Looking ahead, the next few years could bring shifts in the sports ecosystem. Mainstream media outlets may increasingly integrate on-chain odds into coverage, normalizing prediction data as a standard part of reporting. Traditional betting platforms, including DraftKings, are exploring on-chain settlement mechanisms, indicating a gradual migration toward decentralized systems. AI-powered market-making agents may provide continuous liquidity, ensuring prices more accurately reflect real-time developments. Additionally, major sports leagues, such as the NBA and Premier League, may introduce prediction index tokens, contributing to the formation of a decentralized sports exchange-traded fund (ETF) ecosystem. In this evolving landscape, sports engagement would extend beyond entertainment, transforming into a collective intelligence experiment where outcomes, market consensus, and trust are continuously reflected and reinforced through real-time pricing, long after the final whistle.